We want lower oil prices, says the US Secretary General of Energy

US Energy Secretary Jennifer Granholm said on Saturday that volatility continues to weigh on oil markets, repeating calls for additional supplies.

Asked to comment on the state of the oil markets, she told CNBC’s Sri Jegarajah that “there’s no question there’s a volatile environment, and … there’s a lot of indebtedness” — a situation that the White House is watching.

“There is a lot of emotion in these markets, so we have a deep concern about where things are heading,” the energy minister added.

Granholm said she expects US oil demand to increase to 12.5 million barrels per day this year, with further gains in 2024.

Despite this, Granholm also called for additional production to help reduce prices.

“We want to see more supply… It becomes dangerous when prices are too high,” she said. “I think the prudent course is to ensure that transportation is affordable for people, and that of course means making sure supply is stable.”

Some members of the Organization of the Petroleum Exporting Countries (OPEC) and their allies — known collectively as OPEC+ — are voluntarily cutting production by 1.66 million barrels per day (bpd) through the end of 2024. Saudi Arabia and Russia, two heavyweights in the alliance, announced further voluntary cuts in July and August involving 1 million bpd in production and 500,000 bpd in exports, respectively.

High crude prices remain a challenge for the Biden administration, and cutting costs remains a priority.

“We want prices to come down,” Granholm explained. “The president is really focused on the effects on the real people who need the work and can’t afford those premiums.”

Historically, the United States has vocally advocated lower prices at the pump, in an effort to ease pressure on consumer households and curb inflation. Washington has repeatedly pleaded with OPEC+ producers to support this effort by increasing their own production – culminating in a brief war with Saudi Arabia in October last year.

The US now faces lower inflation rates, with the consumer price index showing an increase of 3% year-on-year in June.

Granholm also discussed the importance of transitioning to renewable energy – a major topic at this year’s Energy Summit.

“China and the United States are the world’s largest emitters…their citizens are feeling the effects of these extreme weather events,” Granholm said, adding that the United States is keen to “create an oasis” by cooperating with China in deploying clean energy.

“We have to do everything, everywhere, at once. Spread, spread, spread clean energy. Because if we don’t, our planet is burning, and we must address it.”